Warren is a 46 year old bachelor who has rented a condominium at $900 a month for almost 10 years. He has never owned his own home. Over the years he has kept his credit clean and managed to scrape together $35,000 that he keeps in a low-yield CD.
Warren walked into an open house I was holding in a nearby condominium. I had it for sale at $149,000. We got to talking, and we started scribbling numbers. If we could get the sale price down to $139,000, we calculated that he could buy the condominium with a 20% down payment and end up with a monthly nut of $865. That nut included his mortgage payment, taxes, homeowners association dues, and a little insurance policy for his personal stuff.
I was, in fact, able to negotiate a sale price of $139,000. We found Warren a conventional 30 year fixed-rate loan at 5.25% with one point for the broker. Over, under, and through the obstacles of today’s typical escrow we climbed, crawled, and blasted.
Yesterday, I presented him with the keys to his own place where he pays $35 less than he was paying on rent a month ago. Did I fail to mention his excellent first-time home buyer’s credit of $8000 and the usual mortgage interest adjustment to gross income that he will enjoy next year for the first time in his life and every year thereafter?
In these grim days of real estate gloom and doom, there are terrific success stories, and Warren is one of them. What do you say? Let’s raise our glass and toast to the success and happiness of Warren!
He’s an ex-Marine, by the way, so I’d like to add, “Semper Fi, Brother!”